Judge Virginia Keeny, Case LC106864 2023-05-10 Tentative Ruling

Judge: Virginia Keeny, Case: LC106864, Date: 2023-05-10 Tentative Ruling

Case Number: LC106864 Hearing Date: May 10, 2023 Dept: W

lucky’s two-way radios, inc. et al., v. cannata

Defendant and Cross-Complainant Frank J. Cannata’s Motion to Compel Further Discovery Responses; for Terminating Sanctions; in the Alternative, for Issue Sanctions

Date of Hearing: May 10, 2023 Trial Date: May 15, 2023

Department: W Case No.: LC106864

BACKGROUND

Plaintiffs Lucky’s Two-Way Radios, Inc. and Buddy Corporation (“LTWR”) allege that Frank J. Cannata (“Cannata”) was a consultant for Plaintiffs’ business pursuant to a consulting services agreement. While consulting for Plaintiffs, Cannata allowed or arranged for valuable company property to be taken by “Mr. Recycling” without Plaintiffs’ consent. Plaintiff further claims that on December 8, 2017, Cannata improperly transferred proprietary information via e-mail to personal accounts. Plaintiff alleges a loss of $500,000 in property.

Plaintiffs filed a complaint on February 13, 2018. The Second Amended Complaint (“SAC”) was filed on August 7, 2020, alleging: (1) Breach of Contract; (2) Conversion; (3) Breach of Fiduciary Duty; (4) Fraud and Fraudulent Concealment; (5) Specific Performance; and (6) Permanent Injunction

On March 29, 2019, the court granted Cannata’s motion for leave to file a cross-complaint. Cannata filed the first amended cross-complaint against Plaintiffs Lucky’s Two-Way Radios, Inc. and Buddy Corporation on April 10, 2019.

Cannata filed a second amended cross-complaint (“SAXC”) on August 2, 2019. The SAXC against Cross-Defendants alleges several causes of action including breach of contract, indemnity, labor code retaliation and wage and hour violations, false pretenses, fraud, battery, stored communications violations, trespass, and unfair competition.

On October 13, 2020, default was entered against Defendant because he failed to file an answer to the SAC. Default was set aside and vacated on December 17, 2020.

[Tentative] Ruling

Defendant and Cross-Complainant Frank J. Cannata’s Motion to Compel Further Discovery Responses; for Terminating Sanctions; in the Alternative, for Issue Sanctions is DENIED.

REQUEST FOR JUDICIAL NOTICE

Defendant and Cross-Complainant Frank J. Cannata’s Request for Judicial Notice is GRANTED.

discussion

Defendant Cannata moves the court under Code of Civil Procedure § 2031.320 for an Order compelling further responses by LTWR and Buddy to the previously court ordered responses of Plaintiff LTWR to Cannata’s specially prepared interrogatories, to LTWR, Nos. 129, 130, 131, 140, 141; previously court ordered responses of Plaintiff LTWR to Cannata’s inspection demands, to LTWR, Nos. 103, 104, 105, 106, 107, 108, 109, 110, 112, 114, 115, 116, 117, 118, 119, 120, 121, 122, 123, 124, 125, 126, 127, 128, 129; and previously court ordered responses of Plaintiff Buddy to Cannata’s inspection demands, to Buddy, Nos. 81, 82, 83, 84, 85, 86, 87, 88, 89, 90, 91, 92, 93, 94, 95, 96, 97, 98, 99. Cannata also moves for terminating sanctions, or in the alternative, issue sanctions as well as monetary sanctions and for Mr. Crossin to self-report to the State Bar.

The motion was originally withdrawn by Cannata’s counsel on September 28, 2022. On December 28, 2022, Cannata filed a “Motion for Relief from Default to Compel Further Compliance with the Court’s Discovery Orders; and to Compel Further Compliance with the Court’s Discovery Orders.” The court noted the motion was improperly labeled but agreed Code of Civil Procedure section 473(b) was the proper mechanism to seek relief for an untimely motion to compel further discovery responses. The court put back on calendar the motion that Mr. Lesches withdrew and ordered the parties to file further opposition and reply briefs.

Plaintiffs oppose the motion on the five grounds: (1) Mr. Cannata improperly combined at least five separate motions into this single motion; (2) to the extent the motion seeks to compel a further response, it is untimely by statute and Mr. Cannata has therefore statutorily waived his right to seek further responses to this discovery; (3) to the extent this motion seeks to compel discovery responses for failing to obey a prior court order, Mr. Cannata has failed to establish by any admissible evidence that Plaintiffs failed to comply with any order of this court with regard to the above identified written discovery; (4) Mr. Cannata’s motion fails to identify or explain why Plaintiffs’ Court ordered further responses to the above referenced written discovery are non-compliant with any prior order of this Court; and (5) because Mr. Cannata has failed to identify any prior Court order that Plaintiffs failed to comply with, he is not entitled to any terminating, evidence or issue sanctions as well as any monetary sanctions and is not entitled to a reporting sanction. Plaintiffs also request monetary sanctions in the total sum of $2,550.00 jointly and severally against Mr. Cannata and Mr. Lesches for bringing this motion without substantial justification and for Mr. Lesches to pay a separate monetary sanction of $5,000.00 for his improper and unjustified misuse and abuse of the discovery process.

The court notes Mr. Lesches prepared a reply brief addressing only Plaintiffs’ request for sanctions. Mr. Lesches also claims the opposition was not properly served and Plaintiffs have failed to respond to this issue. Mr. Ritt has not prepared a reply brief. The court notes that Mr. Lesches has been relieved as counsel for Mr. Cannata, based on his request. Nonetheless, the court finds it appropriate for Mr. Lesches to file a brief for the limited purpose of contesting any sanction against himself.

The court finds Plaintiffs have complied with the prior court order. Defendant Cannata himself provides Plaintiffs’ further responses to the discovery at issue. (Lesches Decl. Exhs. A-C.) The parties do not necessarily dispute that they failed to meet and confer regarding this court’s order to narrow the request from “all documents” so as to reduce burdens. (June 10, 2022 Minute Order.) Notwithstanding this failure to work together to resolve these discovery issues, the court finds based on the minute order and Plaintiffs’ supplemental responses, Plaintiffs did not necessarily fail to comply with the May 2, 2022 court order. If Defendant Cannata is seeking further responses, the court is without jurisdiction to hear the untimely motion. (Sexton v. Superior Court (1987) 58 Cal. App. 4th 1403, 1409.)

The court denies Mr. Cannata’s motion for terminating sanctions, or in the alternative, issue sanctions as well as monetary sanctions and for Mr. Crossin to self-report to the State Bar. When a party willfully disobeys a discovery order, courts have discretion to impose terminating, issue, evidence, or monetary sanctions. (CCP §§ 2023.010(g); 2031.300(c) [request for production]; 2030.290(c) [interrogatories]; 2033.290(e) [requests for a admission].) Because the court has found Plaintiffs did not willfully disobey a discovery order, the court finds such sanctions inappropriate.

As for Plaintiffs’ request for monetary sanctions against Mr. Cannata and Mr. Lesches, jointly and severally, and Mr. Lesches separately, the court denies Plaintiffs’ request. There continues to be a genuine dispute amongst the parties and their discovery obligations. Moreover, while the court finds Mr. Lesches’ overall conduct may be hasty and overzealous rather than zealous advocacy, the court finds Mr. Lesches did not act without substantial justification in bringing the motion.

Based on the forgoing, Defendant and Cross-Complainant Frank J. Cannata’s Motion to Compel Further Discovery Responses; for Terminating Sanctions; in the Alternative, for Issue Sanctions is DENIED.